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January 31, 2013

A Strategy for More Fee Income: Adhesion’s Stier

Company’s recent announcements focus on ease of use, revenue increase

“It’s really a high-quality solution with a low cost, which is something that really differentiates it,” Michael Stier told AdvisorOne at TD Ameritrade Institutional’s annual conference in San Diego on Thursday.

Stier, CEO of Adhesion Wealth Advisor Solutions, was referring to last week’s announcement that it is partnering with BlackRock (BLK) to offer the BlackRock Model Portfolios in its investment strategies lineup.

According to the company, Adhesion will offer the BlackRock models in an investable, turnkey solution—“giving RIAs the tools to put their clients’ money to work within these model portfolios, combined with a comprehensive Investing-Monitoring-Reporting service.

“Because they are low cost, advisors will think they’re for the bottom third of their books; those assets that don’t generate a lot of fee income. But it really is for any advisor that wants to move away from picking individual stocks for clients to more of a role with active asset allocation.”

Adhesion’s latest announcement follows on an announcement from November about upgrades to the company’s investing, monitoring and reporting platform.

“That’s really about the UMH,” Stier explained. “What it allows advisors to do is to report on assets that are held away. They can then have a target allocation for total assets. We provide alerts as to when maintenance must be done on the account and they can charge fees for that; they can charge fees on those held-away assets.”

He added that it is also a business intelligence platform that does not swamp the advisor with data. It offers flexible filtering capabilities customized for their business.